Binance analysts talk about their role in catching the ZKasino creator

What’s new? Blockchain researchers from the Binance crypto exchange team played a key role in catching one of the organizers of the ZKasino fraud scheme. The creators of ZKasino raised at least 10 515 ETH from more than 10 000 investors before embezzling the funds and abandoning the project. In late April, Dutch police arrested a 26-year-old man involved in the scheme and seized more than 11 million EUR. Binance representatives told Cointelegraph about how he was tracked down.

Material by Cointelegraph

What else is known? To find the attacker, exchange researchers used a combination of on-chain analysis and open-source intelligence information (OSINT). Analysts examined social media and all ZKasino smart contracts to identify behavioral patterns. This allowed them to determine whose addresses were behind creating contracts and signing transactions.

This is how analysts identified the person who controlled the project’s contracts and then passed this information to law enforcers. As a result, on April 29, the suspect was arrested on charges of fraud, embezzlement, and money laundering. Police also seized his cash, cryptocurrencies, real estate, and a luxury car with a total value of 11,4 million EUR. The man has been placed in custody pending investigation.

The creators positioned ZKasino as a blockchain gaming platform that would allow them to return their investment within 30 days. They managed to raise more than $30 million. However, after analyzing the smart contracts, it turned out that the possibility of withdrawing funds was not expected. Such a scheme is widespread in the crypto space and is called Rug Pull.

Binance also successfully froze millions of dollars worth of cryptocurrency after issuing a warrant to seize the attacker’s accounts. Binance’s investigation department will continue to work closely with authorities to ensure that the stolen funds are returned to investors.

Earlier, Binance founder and former CEO Changpeng Zhao received four months in prison in the United States for violating anti-money laundering regulations.